California Legislature—2015–16 Regular Session

Assembly BillNo. 977


Introduced by Assembly Member Mayes

February 26, 2015


An act to amend Section 13480 of the Water Code, relating to the State Water Pollution Control Revolving Fund.

LEGISLATIVE COUNSEL’S DIGEST

AB 977, as introduced, Mayes. State Water Pollution Control Revolving Fund.

Existing law continuously appropriates state and federal funds in the State Water Pollution Control Revolving Fund to the State Water Resources Control Board for loans and other financial assistance for the construction of publicly owned treatment works and other related purposes, to a municipality, intermunicipal agency, interstate agency, or state agency in accordance with the federal Clean Water Act and the Porter-Cologne Water Quality Control Act. Existing law requires that moneys in the fund be used only for permissible purposes allowed by the Clean Water Act or a federal capitalization grant deposited in the fund to the extent authorized and funded by the grant.

This bill would make nonsubstantive changes to the requirement that moneys in the fund be used only for permissible purposes allowed by the Clean Water Act or a federal capitalization grant deposited in the fund.

Vote: majority. Appropriation: no. Fiscal committee: no. State-mandated local program: no.

The people of the State of California do enact as follows:

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SECTION 1.  

Section 13480 of the Water Code is amended to
2read:

3

13480.  

(a) Moneys in the fund shall be used only for the
4permissible purposes allowed by the federal act or a federal
5capitalization grant deposited in thebegin delete fundend deletebegin insert fund,end insert to the extent
6authorized and funded by that grant, including providing financial
7assistance for the following purposes:

8(1) The construction of publicly owned treatment works, as
9defined by Section 212 of the federal act (33 U.S.C. Sec. 1292),
10by any municipality.

11(2) Implementation of a management program pursuant to
12Section 319 of the federal act (33 U.S.C. Sec. 1329).

13(3) Development and implementation of a conservation and
14management plan under Section 320 of the federal act (33 U.S.C.
15Sec. 1330).

16(4) Financial assistance, other than a loan, toward the nonfederal
17share of costs of any grant-funded treatment works project, but
18only if that assistance is necessary to permit the project to proceed.

19(5) Financial assistance provided under the federal American
20Recovery and Reinvestment Act of 2009 (Public Law 111-5) for
21projects authorized pursuant to this subdivision.

22(b) Consistent with expenditure for authorized purposes, moneys
23in the fund may be used for the following purposes:

24(1) Loans that meet all of the following requirements:

25(A) Are made at or below market interest rates.

26(B) Require annual payments of principal and any interest, with
27repayment commencing not later than one year after completion
28of the project for which the loan is made and full amortization not
29later than 20 years after project completion unless otherwise
30authorized by a federal capitalization grant deposited in thebegin delete fundend delete
31begin insert fund,end insert to the extent authorized and funded by that grant. Loan
32forgiveness is permissible to the extent authorized by a federal
33capitalization grant deposited in thebegin delete fundend deletebegin insert fund,end insert to the extent
34authorized and funded by that grant.

35(C) Require the loan recipient to establish an acceptable
36dedicated source of revenue for repayment of a loan.

37(D) (i) Contain other terms and conditions required by the board
38or the federal act or applicable rules, regulations, guidelines, and
P3    1policies. To the extent permitted by federal law, the combined
2interest and loan service rate shall be set at a rate that does not
3exceed 50 percent of the interest rate paid by the state on the most
4recent sale of state general obligation bonds and the combined
5interest and loan service rate shall be computed according to the
6true interest cost method. If the combined interest and loan service
7rate so determined is not a multiple of one-tenth of 1 percent, the
8combined interest and loan service rate shall be set at the multiple
9of one-tenth of 1 percent next above the combined interest and
10loan service rate so determined. A loan from the fund used to
11finance costs of facilities planning, or the preparation of plans,
12specifications, or estimates for construction of publicly owned
13treatment works shall comply with Section 603(e) of the federal
14act (33 U.S.C. Sec. 1383(e)).

15(ii) Notwithstanding clause (i), if the loan applicant is a
16municipality, an applicant for a loan for the implementation of a
17management program pursuant to Section 319 of the federalbegin delete Clean
18Water Actend delete
begin insert actend insert (33 U.S.C. Sec. 1329), or an applicant for a loan
19for nonpoint source or estuary enhancement pursuant to Section
20320 of the federalbegin delete Clean Water Actend deletebegin insert actend insert (33 U.S.C. Sec. 1330), and
21the applicant provides matching funds, the combined interest and
22loan service rate on the loan shall be 0 percent. A loan recipient
23that returns to the fund an amount of money equal to 20 percent
24of the remaining unpaid federal balance of an existing loan shall
25have the remaining unpaid loan balance refinanced at a combined
26interest and loan service rate of 0 percent over the time remaining
27in the original loan contract.

28(2) To buy or refinance the debt obligations of municipalities
29within the state at or below market rates if those debt obligations
30were incurred after March 7, 1985.

31(3) To guarantee, or purchase insurance for, local obligations
32where that action would improve credit market access or reduce
33interest rates.

34(4) As a source of revenue or security for the payment of
35principal and interest on revenue or general obligation bonds issued
36by the state, if the proceeds of the sale of those bonds will be
37deposited in the fund.

38(5) To establish loan guarantees for similar revolving funds
39established by municipalities.

40(6) To earn interest.

P4    1(7) For payment of the reasonable costs of administering the
2fund and conducting activities underbegin delete Titleend deletebegin insert Subchapterend insert VI
3(commencing with Section 601) of the federal act (33 U.S.C. Sec.
41381 et seq.). Those costs shall not exceed 4 percent of all federal
5contributions to the fund, except that if permitted by federal and
6state law, interest repayments into the fund and other moneys in
7the fund may be used to defray additional administrative and
8activity costs to the extent permitted by the federal government
9and approved by the Legislature in the Budget Act.

10(8) For financial assistance toward the nonfederal share of the
11costs of grant-funded treatment works projects to the extent
12permitted by the federal act.

13(9) Grants, principal forgiveness, negative interest rates, and
14any other type of, or variation on the above types of, assistance
15authorized by a federal capitalization grant deposited in thebegin delete fundend delete
16begin insert fund,end insert to the extent authorized and funded by that grant.



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